Epson’s third-quarter revenue increased due to a market recovery from COVID and at-home print demand but profit decreased due to steep increases in the costs of materials and logistics. The company warned that logistics costs would continue to rise due to the use of air transport and increased ocean freight costs.
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| Flying high - Epson forced to use more airfreight amid soaring container freight costs |
Epson reported ¥296.1 billion in Q3 revenue (up ¥17.3 billion compared to last year) and ¥27.2 billion in business profit (down ¥3.9 billion).
“Revenue increased on a market recovery from COVID-19 and continued at-home print demand, but profit decreased due to soaring materials and logistics costs,” Epson told investors.
“Supplies were constrained by materials shortages and logistics disruptions, but in addition to further reducing our costs, we implemented pricing measures based on the balance between supply and demand and on increases in materials and logistics costs.
“Production capacity not a problem, but semiconductor and other supply constraints to worsen. Logistics costs to further increase due to use of air transport and increased ocean freight costs.”
Commercial & Industrial Printing
Q3 revenue was down ¥4 billion and profit down ¥3 billion.
Market recovery for commercial & industrial IJP was uneven.
Finished products: Supplies were constrained, but revenue increased thanks to an enhanced product lineup.
Printheads: Sales grew in China and Japan.
Small printer demand progressively recovered in the retail and food service industries, but revenue was limited by supply constraints.
Small printer and commercial and industrial IJP finished products supply constraints to worsen.
Logistics costs to increase.
Office & Home Printing
IJP revenue increased chiefly as a result of high- capacity ink tank printer unit sales growth in developed economies and pricing measures. IJP Ink was flat YoY as at-home print demand continued. Office shared IJP revenue increased amid constrained supply. SIDM revenue decreased in China. Profit fell due to costs.
“Q3 results exceeded the internal plan, but risks associated with changes in the business environment were factored into the Q4 outlook,” Epson said. “We are reiterating our previous full-year revenue outlook while raising the business profit outlook.”
Third Quarter Financial Results Fiscal Year 2021 (Ending March 2022)
